Bondholders of South Africa’s state-owned electricity company are watching the latest round of rescue talks from a distance. Yields suggest they’re confident their money is safe, whether or not the discussions result in a sustainable solution for Eskom Holdings’ $32-billion debt pile. Eskom’s risk premium over South African sovereign debt narrowed to a 19-month low last week and remained near that level even amid global bond turmoil. Investors including T Rowe Price International, Insight Investment Management and Aberdeen Standard Investments said they haven’t been approached about the debt plan, but believed a solution could be reached.
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The outgoing National Planning Commission (NPC) is preparing to hand over the extensive work it has done to build consensus on South Africa’s ‘just transition’ to a low-carbon and climate-resilient society to the newly formed Presidential Coordinating Commission on Climate Change (PCCCC). When doing so this week, Commissioner Tasneem Essop said that it would emphasise that a transparent and inclusive process, which included affected workers and communities, was as important as the outcomes, as developing a social compact on the just transition was a political process rather than a technical exercise.
The National Energy Regulator of South Africa (Nersa) announced on Thursday that the Energy Regulator, at its meeting held on February 25, approved the issuance of a generation licence for a 40 MW solar photovoltaic (PV) plant to be developed at the South Deep gold mine, in Gauteng. The licence was granted to GFI Joint Venture Holdings Proprietary Limited and Gold Fields Operations Limited (South Deep Joint Venture) to operate a generation facility to be constructed in Westonaria, south-west of Johannesburg.
The 2021 Budget, presented by Finance Minister Tito Mboweni on February 24, outlines that R93.1-billion has been earmarked for economic regulation and infrastructure, from consolidated government expenditure of R2.02-trillion each year over the medium term. To boost infrastructure spending, government plans to partner with the private sector, multilateral development banks and development finance institutions to augment its skills, expertise and funding.
Revego Africa Energy Fund, an investor in South African renewable projects, is looking to raise as much as R1.5-billion by April with the industry poised to grow.The fund is backed by Investec, the Eskom Pension & Provident Fund and UK Climate Investment and is seeking to list on Johannesburg’s stock exchange, according to Revego Fund Managers chief investment officer Michael Meeser. “We have already identified assets equal to that value and have actually signed purchase agreements,” he said.The listing may come as South Africa starts to accept bids from independent energy producers to help ease the burden on state-owned utility Eskom Holdings, which struggles to meet the country’s electricity demand. The government is committed to buy an additional 11 800 MW of power from various sources, President Cyril Ramaphosa reiterated this month.
The case against two former Eskom executives who were allegedly involved in a R745-million corruption case at the Kusile power station has been postponed for more than three months. Former Eskom Group Executive for the Group Capital Division Abram Masango and former contracts manager France Hlakudi appeared in the Specialised Commercial Crimes Court sitting in Palm Ridge Magistrate’s Court on Tuesday.
South Africa’s energy sector needs to broadly embrace a just energy transition to ensure it improves energy security and stability, as well as meets its obligations towards mitigating climate change, says nonprofit economic research institution Trade and Industrial Policy Strategies senior economist Gaylor Montmasson-Clair. He says a fair and equitable energy transition away from fossil fuels, and coal in particular, and towards renewable energy and other forms of less carbon intensive energy needs to embrace three key dynamics.
Eskom’s recently tabled tariff restructure programme, which proposes changes such as charging consumers a fixed connection fee, may indeed improve the landscape for renewable energy in South Africa, says Energy Partners Intelligence business development head Tygue Theron.
He tells Engineering News that while there has been a fair amount of criticism levelled against the State-owned utility’s proposed plan, as well as recent developments that are expected to result in a 15.63% increase in tariffs from April 1, there is another way to look at the situation.
International rivers and river communities rights nongovernmental organisation International Rivers has called on South Africa to withdraw its agreement to offtake electricity from the Inga 3 hydropower project being built in the Democratic Republic of Congo (DRC). South Africa continues to uphold its commitment to procure power from the delayed Inga 3 hydropower dam, but the power imported from Inga is expected to cost R175-million a year more than domestic power generation, the NGO avers.
South African adventurer and former naval officer Zirk Botha is days away from finishing his solo transatlantic ocean row, from Cape Town to Rio de Janeiro, during which he will have covered 7 200 km, or 4 000 nautical miles. Botha left Cape Town on December 19, 2020, and is set to arrive in Rio de Janeiro on the weekend of February 28, 2021.
INDUSTRY NEWS
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